UnitedHealth Backs Medical Schools Sought for 2 UC Sites

UnitedHealth Group Inc., the nation's second-largest health insurer, joined efforts to head off an expected shortage of doctors with a $10-million donation to two proposed medical schools in California.

The gift, expected to be announced today, fulfills part of a pledge that the Minnetonka, Minn.-based company made last year to state regulators. In seeking approval for its acquisition of Cypress-based PacifiCare Health Systems Inc., UnitedHealth agreed to contribute $50 million to charity.

The donation to the University of California will go to its campuses at Merced and Riverside, which have proposals to build the first new UC medical schools since the 1960s.

Like much of the country, California is on the verge of a physician shortage. With baby boomers aging, they require more medical care. In addition, more doctors within that generation are expected to retire, exacerbating the shortage.

By 2015, the state could be 17,000 doctors short of what is needed based on demographic trends. Fast-growing regions such as the Inland Empire and San Joaquin Valley would be especially affected.

"We want to grow our business in these areas," UnitedHealth spokesman Tyler Mason said, "and it is important that they have adequate networks" of doctors.

The money will be equally divided between the campuses and given over the next three years. Both universities have proposals for medical schools pending with UC officials. If they are approved, it would be several years before their first doctors graduate.

UC Riverside, the larger campus with 16,600 students, hopes to establish a medical school by 2012 at a cost of more than $1 billion, officials said. The 1,300-student UC Merced, which opened last fall, has a similar timeline but no details on cost yet, its officials said. Both campuses said UnitedHealth's donation would boost their chances by strengthening their health sciences curricula through new staff and research programs.

"This is a great kickoff to our fundraising phase," said Maria Pallavicini, dean of the school of natural sciences at UC Merced.